E8-8 Cruise Industries
E8-8 (Purchases Recorded, Gross
Method)
Cruise Industries purchased
$10,800 of merchandise on February 1, 2014, subject to a trade discount of 10%
and with credit terms of 3/15, n/60. It returned $2,500 (gross price before
trade or cash discount) on February 4. The invoice was paid on February 13.
Instructions
(a)Assuming that
Cruise uses the perpetual method for recording merchandise transactions, record
the purchase, return, and payment using the gross method.
(b)Assuming that
Cruise uses the periodic method for recording merchandise transactions, record
the purchase, return, and payment using the gross method.
(c)At what amount
would the purchase on February 1 be recorded if the net method were used?
TUTORIAL PREVIEW
(a)
|
Feb. 1
|
Inventory [$10,800 – ($10,800 X 10%)]
|
9,720
| |
Accounts Payable
|
9,720
| |||
Feb. 4
|
Accounts Payable [$2,500 – ($2,500 X 10%)]
|
2,250
|
File name: E8-8 Cruise
Industries.docx File type: .docx PRICE: $6
